Problem $9-17$ Comparing Investment Criteria $[$LO$1,2,3,5,7]$

Consider the following two mutually exclusive projects:

Whichever project you choose, if any, you require a return of $14$ percent on your

investment.

a$-1.$ What is the payback period for each project? $($Do not round intermediate

calculations and round your answers to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

a$-$

If you apply the payback criterion, which investment will you choose?a$-$ If you apply the payback criterion, which investment will you choose?

Project A

Project B

b$-$ What is the discounted payback period for each project? $($Do not round intermediate

calculations and round your answers to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

b$-$ If you apply the discounted payback criterion, which investment will you choose? $2.$

Project $A$

Project Bc$-1.$ What is the NPV for each project? $($Do not round intermediate calculations and

round your answers to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

If you apply the NPV criterion, which investment will you choose?

Project A

Project B

d$-$ What is the IRR for each project? $($Do not round intermediate calculations and enter

your answers as a percent rounded to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$e$-1.$ What is the profitability index for each project? $($Do not round intermediate

calculations and round your answers to $3$ decimal places, e$.$g$.,32\mathrm{.}161.)$

If you apply the profitability index criterion, which investment will you choose?

Project $A$

Project B

f$.$ Based on your answers in $($a$)$ through $($e$),$ which project will you finally choose?